The news
The numbers suggest software renewal negotiations are shifting toward buyers. Public horizontal SaaS companies traded at a median enterprise value of 2.2 times forward revenue as of September 29, according to Multiples.vc, while results from Oracle (ORCL) and Adobe (ADBE) on September 10 showed application growth far behind the AI infrastructure boom.
Oracle's fiscal first-quarter filing makes the gap plain. Cloud infrastructure revenue rose 121% to $7.4 billion in the quarter ended August 31, while cloud applications, Oracle's software-as-a-service business, grew 10% to $4.2 billion. Software revenue fell 3% to $5.5 billion, which Oracle attributed to customers moving from on-premises software to the cloud. Oracle said AI demand for training and inference is growing faster than it can supply; its capital spending reached $28.5 billion in the quarter, and contracted future revenue hit $664 billion.
Adobe's ending annual recurring revenue (ARR) grew 11.2% to $27.50 billion, and the company targets 10.2% ARR growth for the full year. Analysts at Morgan Stanley and BMO Capital, cited by Yahoo Finance, put the year-over-year drop in net new ARR at about 38%; Yahoo reported organic net new ARR of $390 million, down from $640 million a year earlier. Investing.com reported that Adobe acknowledged delaying some pricing actions in Creative Cloud to support user acquisition, a sign that adoption matters more to the company than near-term price.
Valuations reflect those trends. Multiples.vc puts the median at the same 2.2 times for vertical SaaS and 3.0 times for infrastructure SaaS, with artificial intelligence companies at 3.9 times and DevOps tools at 9.0 times. Crunchbase News reported on September 16 that enterprise software was nearly absent from 2026's IPO market. In private markets, TechCrunch reported on September 10 that Bending Spoons will buy Miro for $1.36 billion, about 92% below Miro's $17.5 billion valuation in late 2021.
Vendors are responding with bundles rather than list-price cuts. Salesforce (CRM) introduced Core, Advanced and Max editions on September 3 at $195 to $550 per user per month, folding in AI agents, Slack, analytics and usage credits, and offered existing Agentforce 1 customers an upgrade to Max at no extra cost.
The numbers
- Median EV/forward revenue, horizontal SaaS (Sept 29)
- 2.2x
- Median EV/forward revenue, infrastructure SaaS (Sept 29)
- 3.0x
- Oracle cloud applications revenue growth
- 10% to $4.2 billion
- Oracle cloud infrastructure revenue growth
- 121% to $7.4 billion
- Adobe ending ARR growth
- 11.2% to $27.50 billion
- Salesforce edition prices
- $195 to $550 per user per month
Why CEOs should care
Procurement teams should start renewals six to nine months before expiry and open with data: current usage, unused seats and a credible alternative. Vendors growing at 10% need to keep existing customers, which makes multi-year price caps, flat renewals and the removal of unused licenses realistic asks. Trade what vendors value, such as longer terms, case studies or early commitment, for what you value, such as price protection and exit rights. Be wary of bundles that raise the total commitment while promising more value per seat.
CFOs should separate the core license from AI add-ons. Many vendors are pushing agent and credit bundles before customers have proof of return. Ask for AI features as opt-in pilots with defined success metrics and a right to drop them at renewal, rather than as mandatory upgrades. Where a vendor is shifting to usage pricing, lock unit rates and caps now, while it still needs your signature more than you need its roadmap.
CIOs should also weigh vendor health. Leverage cuts both ways: a vendor under margin pressure may respond to discounts by cutting support or investment, or by selling itself. Pair price concessions with service-level commitments, named support contacts and data-export guarantees, so a good deal does not become a stranded product.
The bigger picture
The software market is splitting. Money is flowing to AI infrastructure and to the few application companies seen as AI winners, while most established application vendors grow slowly and trade at low multiples. Oracle's $28.5 billion in quarterly capital spending shows where vendor investment is going. That gives application buyers a window. It may not last: vendors are building usage meters and credit systems designed to capture growth from AI adoption, and those contracts will be harder to negotiate once usage data sits on the vendor's side.
What’s next
Several decision points arrive in the fourth quarter. Workday (WDAY) holds its Rising customer conference October 12 to 15 in Las Vegas, focused on AI agents for HR and finance. Adobe changes CEOs on December 1. Companies setting 2027 budgets should map every renewal due in the next twelve months and assign a negotiation owner to each.
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